SEP 22,2003 0:11 PACIFIC 3:11 EASTERN
( BW)(ATOS-ORIGIN) Atos Origin Acquisition of SchlumbergerSema;
Creating a European IT Leader and World Player
Business Editors
PARIS & AMSTERDAM, Netherlands--(BUSINESS WIRE)--Sept. 22,
2003--Atos Origin today announced that it has signed an agreement to
acquire the core IT services activities of SchlumbergerSema from
Schlumberger.
The agreement, which is expected to be completed no later than
January 2004, is subject to regulatory approvals and approval by the
shareholders of Atos Origin. The transaction will create one of the
leading global IT services companies, with combined annual revenues in
excess of EUR 5 billion.
Highlights of the deal are as follows:
-- Creating a global organization with annual revenues of more
than EUR 5 billion
-- A combined workforce of 50,000 staff operating in 50 countries
-- The new group will have a major presence in the critical UK
market
-- Together with a strong foothold in all key European markets.
-- Reinforced presence in Outsourcing and Public Sector
Atos Origin and SchlumbergerSema have complementary geographic
operations and key competencies, and the deal will strengthen the new
company's offerings to its extended base of clients.
Business Rationale
Atos Origin's primary strategy is to establish a strong and
balanced presence in all of the major IT spending markets of Europe,
in order to be able to provide comprehensive IT support services for
its multinational client base. The acquisition of SchlumbergerSema
creates an organization with a leading presence in the IT services
markets in France, Benelux, the United Kingdom, Spain and Italy and
Atos Origin remains intent on achieving critical mass in the Central
Europe region. The deal complements Atos Origin's strategy of
providing extended support operations for its multinational clients in
The Americas and Asia Pacific.
Financial Structure
As consideration for the purchase of SchlumbergerSema, Atos Origin
will deliver 19.3 million shares to Schlumberger including 0.3 million
treasury shares, representing 28.9% of the outstanding capital of the
combined group, together with EUR 400 million in cash. The
transaction, based on the volume weighted average price of Atos Origin
shares for the 20 days preceding September 19th, 2003 (EUR 45.9),
values the purchase consideration at EUR 1,287 million.
Subsequent to closing, Schlumberger intends to reduce its
shareholding in Atos Origin to 19%, which will improve Atos Origin's
free float and stock liquidity.
As a result of this transaction Philips' shareholding will be
diluted from 44.7% to 32.0%
Benefits of the Deal and Funding Structure
Schlumberger has agreed in principle to enter into an IT services
agreement with Atos Origin with minimum revenues of US$700 million,
subject to final agreement on pricing and service levels.
During the remainder of 2003, SchlumbergerSema's existing
restructuring plans will be accelerated. Atos Origin intends to
execute its merger plans rapidly, thereby achieving incremental top
line growth, organizational streamlining and significant cost
synergies. Cost savings in excess of EUR 200 million per annum are
expected to accrue within two years and the deal will be accretive to
earnings in 2004, before the costs of restructuring and goodwill
amortization.
At the completion of this deal, Atos Origin expects to have net
debt of approximately EUR 750 million, representing a gearing level of
around 50%. The group has negotiated a new syndicated loan facility
for EUR 900 million with three major banks, which will provide
adequate funding for the group's foreseeable needs. It is the group's
intention to divest a number of non-strategic assets during 2004,
which will enhance the group's strong operational cash flow.
Management
Following shareholder and regulatory approvals, the new group will
be led by Bernard Bourigeaud, Chairman of the Management Board and
Chief Executive Officer. The composition and responsibilities of the
new Management Board, which will take effect at closing, will be as
follows:
-0-
*T
Bernard Bourigeaud Chief Executive Officer
Xavier Flinois UK, The Americas and Asia Pacific
Coordinating Global Markets & Key
Accounts/Olympics
Dominique Illien France and Central Europe
Coordinating Managed Operations, AtosEuronext
& Worldline
Wilbert Kieboom Benelux/ICA and Scandinavia
Coordinating Consulting and Systems
Integration
Giovanni Linari Italy, Spain, Middle East and Africa
Eric Guilhou Chief Financial Officer
Jans Tielman Human Resources and Communication
*T
Once we have shareholders and regulatory approvals, an integrated
sales organization will be prepared in outline and plans will be
determined for Atos Origin's large accounts program to be extended to
integrate the major clients of SchlumbergerSema. The merged group is
expected to be fully operational in January 2004 and will trade as
Atos Origin.
An Exciting Venture
Bernard Bourigeaud, Atos Origin's Chief Executive commented:
"This transaction provides Atos Origin with critical mass in
almost all of the major IT spending markets of Europe, together with
strong extended support coverage on a global basis. This is absolutely
essential if we are to provide our clients with effective support and
have the capacity and flexibility to win major new clients.
The global IT services industry is going through an important
phase of consolidation and Atos Origin intends to be at the forefront
of this structural change. We are acquiring excellent management at
SchlumbergerSema and fresh opportunities to drive top line and cost
synergies. We will continue to execute our strategy and I am confident
that the integration of our two companies will be a great success.
We are pleased and proud to welcome SchlumbergerSema staff
worldwide. SchlumbergerSema is widely recognized for its competence
and innovative technology, which will be of enormous value to our
expanded client base."
About Atos Origin
Atos Origin is an international information technology services
provider. Its business is turning client vision into results through
the application of consulting, systems integration and managed
operations, including outsourcing and on-line services. In August
2002, Atos Origin acquired KPMG Consulting in the UK and The
Netherlands, trading as Atos KPMG Consulting. The company currently
generates annual revenues of EUR 3 billion and employs 28,000 staff in
30 countries. The Group's client list includes major companies such as
ABN AMRO, Akzo-Nobel, Alstom, BNP Paribas, BP, Euronext, Fiat, ICI,
ING, KPN, Lucent, Philips, Renault, Royal Bank of Scotland, Saudi
Aramco, Shell, UBS Warburg, Unilever, Vivendi Universal, Vodafone and
Wolters Kluwer.
For more information, please visit the company's web site at
http://www.atosorigin.com
About Schlumberger
Schlumberger is a global oilfield and information services company
with major activity in the energy industry. The company employs 78,000
people of more than 140 nationalities working in 100 countries and
comprises three primary business segments. Schlumberger Oilfield
Services is the world's premier oilfield services company supplying a
wide range of technology services and solutions to the international
oil and gas industry. WesternGeco, jointly owned with Baker Hughes, is
the world's largest and most advanced surface seismic company.
SchlumbergerSema is a leading supplier of IT consulting, systems
integration, and network and infrastructure services and employs
approximately 22,000 staff in more than 40 countries. In 2002,
Schlumberger operating revenue was $13.2 billion of which
SchlumbergerSema generated just under $3 billion. The activities being
acquired by Atos currently produce annual revenues of approximately
$2.6 billion. For more information, visit slb.com.
--30--NE/uk*
CONTACT: Atos Origin
(Press)
Marie-Tatiana Collombert, +33 (0) 1 49 00 96 33
marie-tatiana.collombert@atosorigin.com
or
(Investors)
John White, +33 (0) 1 49 00 96 64
john.white@atosorigin.com
KEYWORD: FRANCE NETHERLANDS INTERNATIONAL EUROPE
INDUSTRY KEYWORD: SOFTWARE E-COMMERCE INTERNET ENERGY OIL/GAS
MERGERS/ACQ
SOURCE: Atos Origin
REPEATS: New York 212-752-9600 or 800-221-2462; Boston 617-236-4266 or
800-225-2030; SF 415-986-4422 or 800-227-0845; LA 310-820-9473